V.U.C.A. Helps Companies Deal with Dynamic, Shifting and Challenging Situations

V.U.C.A. Helps Companies Deal with Dynamic, Shifting and Challenging Situations

Our world, our universe is characterized by constant change. Stars are born and die, storms transform the landscape, nations rise and fall, people change over time. In the business world economies grow and collapse, business models evolve, industries transform and even the Top 100 list of leading companies completely changes in a matter of a few years.

But sometimes the speed and scope of change is extremely rapid, its consequences unforeseeable and unpredictable. This makes planning and decision making highly risky because it is so difficult to see what the future holds. “Everybody has a plan,” said championship boxer Mike Tyson, “until they get punched in the face.”

To help explain the often sudden, fluid, rapidly evolving and dynamic forces of change – that “punch in the face” — the U.S. Army War College created the term V.U.C.A. to describe and ultimately deal with highly dynamic, shifting and challenging situations.

What V.U.C.A. Means

V = Volatility: The up-and-down dynamics of change, difficult to calculate or measure; the speed and direction of change.

U = Uncertainty: The element of unexpected surprise and the lack of predictability. The old game plan doesn’t work anymore. 

C = Complexity: Various and multiple events and forces, confusing issues, no clear cause-and-effect chain, a lack of roadmaps and direction. Age and experience are no guarantees of success.

A = Ambiguity: A lack of clarity, no one definition of “reality,” the potential for misreading situations, mixed and multiple meanings of events; unclear what awaits around the corner, and the future is unforeseeable.

V.U.C.A. in Your Office

V.U.C.A. situations occur in business in times of lean or cost-cutting policies, restructuring, re-organization, disruptive innovation, mergers and acquisitions, and rapidly changing market forces. Usually, there are changes in management, departments downsize or merge with others, and there may be layoffs and firings as well.

The Effects of V.U.C.A. at Work & V.U.C.A. as a Strategy

V.U.C.A. is a radical or extreme part of the forces of transformation and change. For management and employees, this may produce fear, anxiety, confusion, negative stress, paralysis, health problems, depression, frustration and even anger. Some people may attempt to ignore, deny or even resist V.U.C.A. situations; others can’t cope with V.U.C.A. and leave the company.

For leaders, V.U.C.A. challenges them particularly to anticipate and prepare for the possibility of change, to understand the consequences of their decisions and actions, to prepare for and accept new realities, to create and sustain trust in their teams and organizations with confidence, inspiration and purpose.

Moreover, V.U.C.A. can be a deliberate management strategy. Executives may introduce V.U.C.A. in order to shake up teams as part of their re-organization strategy in  the hopes of creating – even forcing – breakthroughs in thought and behavior, inject new energy and speed into dusty processes and sleepy teams, to move people and organizations out of their comfort zones, and to even spark creativity and innovation.

Welcome to the V.U.C.A. World & Its Requirements

If not dealt with and embraced, V.U.C.A. can have a very destructive impact on individuals and organizations. Leaders have a responsibility to anticipate potential V.U.C.A. situations. This means that managers and teams must develop situational awareness, be dynamic, agile, and possess quick understanding, fast decision-making and the ability to change plans rapidly as the situation changes.

For diverse teams, V.U.C.A. demands intercultural skills – some cultures welcome change and ambiguity (like the USA), others fear it (such as Germany). Managers and teams have to get used to short-term planning, and that even these plans will and must change as the situation changes. There is a certain amount of “controlled chaos” in V.U.C.A. situations.

V.U.C.A. creates many threats but simultaneously many opportunities.

Both individual responsibility and clear and efficient cross-team communication are essential. Everybody has to be alert and aware at all times. Stress levels are high. People and teams are given and allowed greater freedom of action in dealing with surprises but also sudden solutions and innovations. “Fast trust” has to be established as there is no time for the slow process of traditional trust-building.

Effective managers and high potential employees are characterized by resilience, the ability to stay cool and keep your head in crisis situations and to be skilled in making bold and quick decisions. Leaders must feel comfortable in V.U.C.A. situations. This requires a high level of situational and self-awareness to deal with grace and poise with the unexpected. “What is courage?” someone asked the writer Ernest Hemmingway. “Grace under pressure,” he replied.

In the V.U.C.A. world, the old game plan, the established rules and processes, even thinking patterns no longer work. There may be structural breakdowns. New ways have to be developed, new process, new realities identified and accepted and fresh new tactics and strategies developed to effectively deal with the challenges and changes of V.U.C.A.

 Your V.U.C.A. Success Strategy

V.U.C.A. contains many threats, challenges and dangers. But managers and their teams can successfully adapt to, negotiate and use the forces V.U.C.A. unleashes by:

  • Accepting, embracing and feeling comfortable in a V.U.C.A. world
  • Realizing and accepting that all plans change upon contact with reality
  • Seeing and seizing opportunity in change
  • Excellent on-going communication
  • Releasing creativity and innovation
  • Sharing responsibility with team members & promoting a “you can do it! I believe in you!” mindset and culture
  • Build an authentic sense of camaraderie and trust
  • Collectively and publicly acknowledging and celebrating all victories and successes
  • Pro-active listening: leaders listen more than they talk, and ask open questions
  • Allowing and encouraging room for mistakes, exploring new methods and ideas
  • Accepting an element of risk in decision-making
  • Changing mindsets to enjoy the surprise and thrills of the unexpected
  • Firm, bold and calm leadership
  • Promoting optimism and positive energy
  • Focusing on outcomes, results and solutions, not problems and dead-end thinking
  • Respecting people’s fear of the New, fear of change
  • Decisive and fast decision-making
  • Promoting an inclusive, “How can we solve this?” mindset and communication style
  • Fluid, relaxed hierarchies
  • Excellent team-to-team communication channels & information sharing
  • Respecting and valuing each team members’ level of expertise
  • Empowering others to promote innovative solutions and to get desired outcomes
  • Using multiple tools, tactics and strategies to overcome obstacles and drive outcomes
  • Enhancing team and management situational awareness
  • Seeing trust as a given; “fast-trust” instead of the long, risk-averse process of “testing” trust
  • Distancing yourself and your people from those who are resistant to V.U.C.A. challenges and transformations. Stay away from weak or bad decision-makers. Stay away from those with poor judgment.
  • Realizing that V.U.C.A. is sharp and brutal reality.
  • Building diverse and inclusive teams which are by nature more accepting and less fearful of V.U.C.A. situations
  • Knowing that wisdom is stronger than intelligence. Age, years in the company, expertise and educational degrees are no guarantees of success.

Like a ship in a storm, people and organizations in V.U.C.A. situations can be safely and successfully steered and managed. V.U.C.A. brings out the best and the worst of people and teams. The potential for the self, team and departmental development is immense. The challenges are great — but so are the opportunities.

Enjoy the ride!

About the Author

Andreas Fornwald

Andreas Fornwald is an award-winning executive (C-level) with expertise in manufacturing, power generation & electrical engineering. Andreas, a Stanford Sloan Fellow, has rescued $100M+ companies from Chapter 11, globalized a $600M EPC and successfully conducted business in 64 countries for Siemens and other major corporations, boosting EBITDA by up to 40% annually, and increasing market share by more than 30%. Andreas is a firm believer in the magic of reinvention both in business and personal development skills.